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President Obama has proposed cutting Social Security by replacing
the program's current inflation adjustment with the stingier
"chained" Consumer Price Index.

As I've discussed before, this risks undoing all
the progress made against senior poverty since the passage of
Medicare and Medicaid in 1965. 25% of seniors were poor according
to official poverty line in 1968, compared to just 9.4% in 2006.
Note, however, that the Supplemental Poverty Measure, which includes
things like out of pocket health care expenses which hit seniors
disproportionately, already shows a 16.1% rate by 2009.

And our senior poverty rate, measured by the international standard of 50% of
median income, is already 25%, much higher than most developed
countries, more than three times Sweden's rate and over four
times as high as Canada.

Why is Obama doing this? We just rejected the candidate who
wanted to cut Social Security and Medicare. Perhaps, as Krugman
(link above) suggests, he chasing the fantasy of "being the adult
in the room," but this is a losing proposition.

We've seen this game before. The Heritage Foundation's health care plan became
"death panels" when President Obama endorsed it. And, as
Beutler's title makes clear, we have plenty of examples of the
President negotiating with himself to bad effect, most notably in
the 2011 debt ceiling battle.

If this cut really happens, Social Security benefits will
steadily fall in true inflation-adjusted terms due to the
magic of compounding. Moreover, with 49% of
the workforce having no retirement plan at work and another
31% with only a grossly inadequate 401(k), the cuts will worsen
the coming retirement crisis.

The only question will then be: how high will senior poverty have
to go before we do something about it?